Early Look: China Economic Growth Likely Took Another Step Down in 2015

China is likely to register its slowest annual growth in more than 20 years.

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Despite concerted efforts to bolster the staggering economy, China is set to deliver its slowest annual growth in more than two decades.

The world’s second-largest economy likely expanded 6.9% from a year earlier in the last quarter of 2015, according to a median forecast of 15 economists polled by The Wall Street Journal. That pace matches the growth rate in the third quarter, suggesting the economy is stabilizing and bringing the full-year rate to 6.9% as well.

The reading of below seven would be lower than a revised 7.3% in 2014 but roughly in line with the target Beijing set of “about 7%” for the year.

Faced with persisting drags on the economy—industrial overcapacity, an overbuilt property market and high corporate debt levels—the leadership has been trying to temper expectations by a public used to high rates of growth. The leadership has stressed that China needs better quality rather than faster growth.

But President Xi Jinping has also said a minimum of 6.5% growth is needed to realize Beijing’s goals of doubling people’s average income and doubling the size of China’s economy from 2010 to 2020. To get there, many economists say Beijing will have to stimulate the economy, boost spending on infrastructure and lower costs to businesses—a strategy that risks more debt and more money spent on unneeded factories, buildings and highways.

Though questions remain about the accuracy of official data, economists said there are signs that Beijing’s policies may have arrested the downward drift. "Thanks to the continued trickling through of recent growth support policies, ongoing property sales growth, and still improving credit growth, December real economic activity likely stabilized at low levels," UBS economists said in a note.

Value-added industrial output likely rose 6.0% in December, a tad down from a 6.2% increase in November, according to the Journal survey. Nonrural fixed-asset investment likely grew 10.2%, unchanged from the increase over the first 11 months, while retail sales are expected to have risen 11.2% in December, flat with the level November's level.

The country’s low inflation allows for more room for further monetary policy easing, economists have said.

The consumer-price index is expected to have risen 1.6% from a year earlier, slightly higher than a 1.5% increase in November, the survey shows. China's producer-price index likely fell 5.8% last month from a year earlier, improving slightly from a 5.9% on-year decline in November. The gauge of factory-gate prices has been dropping for nearly four years.

Foreign trade, however, probably worsened. China's exports likely slumped 8% from a year earlier in December, after dropping 6.8% on year in December, the poll showed. Imports may have fallen 11% on year in December, compared with a decline of 8.7% in November.

That may have pared the nation's trade surplus to $53.0 billion last month, from $54.1 billion in November, according to the poll.